Cities ranked by ultra high net worth population and growth

[JManc]

Originally Posted by Pedestrian

Define "years ago".

Before 2015-2016, what this graph referenced. The FANG's were well established and on their way to expanding their market cap by then. Same thing with companies like Uber, Lyft, Air BnB, Salesforce and Twitter .

[Pedestrian]

Originally Posted by JManc

Before 2015-2016, what this graph referenced. The FANG's were well established and on their way to expanding their market cap by then. Same thing with companies like Uber, Lyft, Air BnB, Salesforce and Twitter .

Facebook IPO'd in 2012 and closed trading its first week as a public company at $26 and change per share. 6 years earlier in 2006, Yahoo tried to buy it for $1 billion. Today it has a market cap of over $400 billion. That's quite a lot of wealth creation in the last decade since this thread is about the very wealthy and where they live: In other words, in the last 10 years (to me more than 10 years ago seems a fair way to look at "years ago"), Facebook alone has created a lot of people in the "ultra high net worth" category.

Similarly, in the last 10 years Netflix stock has gone from around $2.50 per share to almost $150.00 multiplying the net worth of its founders and early holders by 60 times. Amazon's market cap is now 10 times what it was 10 years ago. And so on and so on.

So it doesn't make a lot of sense to me to think of tech money as in any way "old money" or claim a lowish growth rate in the tech economy in 2015/2016 is due to tech being an industry that saw most of its growth "years ago".

What is happening in 2015/2016 is that in that time frame and into 2017 tech growth has slowed transiently as happens to all industries. Just prior to these last 2 years it was booming and it will boom again. I personally have seen a number of these slumps, the worst being in 2000-2003. But there are many tech companies, perhaps the majority not yet public, around in 2017 that didn't exist in 2010 even and more being dreamed up every day. The tech industry is very different today than 10-20 years ago ("years ago" in a reasonable definition). In the 1990s it was about hardware: routers, switches, chips, fiber. Companies specializing in that stuff, like 90s darlings Cisco Systems and Intel, are relative dogs today. Companies from that era that have managed to reinvent themselves (Cisco is trying to reinvent as a net security company) like Microsoft, Amazon and Google are doing much better, but they are practically new companies.

[tech12]

Originally Posted by Private Dick

Nor is one that splits the NYC area from Philadelphia area.

So if we're going down that road, then NYC and Philadelphia should be together too. That would make 10,370. But why stop there? Let's add in the Baltimore/DC/Northern VA area too, because it's all connected, right? That would make 12,940 of those really wealthy buggers.

Except for the fact that SF and SJ are already part of the same CSA, share public transit (including BART, soon), share radio/tv stations, share sports teams, share government stuff (the Metropolitan Transportation Commission covers both MSAs, for example), and identify as being within the same region. None of that is true for NYC and philly.

The truth is that the US census methodology for determining MSAs (and urban areas) works well with a more typical development layout of a central city with suburbs radiating outwards, but it's reliance on commuter interchange and contigous development of a certain density/width, doesn't play nice with multi-nodal metro areas with development patterns that are constrained by geography, and in the case of the Bay Area, breaks it down too much. That doesnt mean that multi-nodal metros aren't metros though.

Go ask someone living in vallejo if their city is a suburb of SF/Oakland. They'll say yes....yet the census considers vallejo to be the principal city of a separate metro area. Sometimes the ideas that work on paper just don't reflect reality.

Of course the CSA definition isnt perfect either. Most people don't consider Santa Cruz and Stockton to be part of the Bay Area, for example. But it is more accurate for this region than the MSA measurement is, when trying to figure out the extent of the SF/Oakland/SJ metro area.

[Vlajos]

Originally Posted by LMich

Oh, god, let's not go over this again. What I will say is just because there are a few exceptions where CSAs should be MSAs - and you could count largest examples on one hand - doesn't mean using MSA shouldn't be the rule. It does not invalidate the entire comparison. Let's not keep doing this. You want to add SF and SJ together? Do it. This is not rocket science. For the vast majority of comparisons, MSAs work.

Exactly. Besides, it's not really all that important. If it makes delicate Bay area dwellers feel good, they should do the math.

[Crawford]

No way are these numbers correct.

How did London lose 15% of it's HNW households in one year? That's like wartime catastrophe numbers. In reality London has been booming with fast population growth.

And it isn't Brexit. These numbers are pre-Brexit.

[Crawford]

Originally Posted by Mr Roboto

Anyway I agree that MSAs are defined pretty clearly, they are what they are and are certainly applicable in many city discussions.

I prefer CSAs over MSAs, and think they're a bit better from a comparative standpoint (better to overcount than undercount), but yeah, you can't pick and choose.

You take one or the other, for every metro.

[dimondpark]

Originally Posted by dimondpark

ijs, Latest data from CA.

2014 Number of Individual & Joint Tax Returns Reporting Annual Income, $1 Million+
San Francisco-San Jose MSAs 21,232
Los Angeles MSA 20,658



From the California Franchise Tax Board
http://www.lao.ca.gov/LAOEconTax/Article/Detail/205

Decided to go down farther...

2014 Number of Individual & Joint Tax Returns Reporting Annual Income, $500,000+
San Francisco-San Jose MSAs 61,211
Los Angeles MSA 57,021

2014 Number of Individual & Joint Tax Returns Reporting Annual Income, $400,000+
San Francisco-San Jose MSAs 89,970
Los Angeles MSA 80,581

[dimondpark]

Originally Posted by Crawford

No way are these numbers correct.

How did London lose 15% of it's HNW households in one year? That's like wartime catastrophe numbers. In reality London has been booming with fast population growth.

And it isn't Brexit. These numbers are pre-Brexit.

Yup. Something is wrong with the data.

[emathias]

Originally Posted by YSL

...
Surprised Chicago is growing at all.

Originally Posted by Crawford

No way are these numbers correct.

How did London lose 15% of it's HNW households in one year? That's like wartime catastrophe numbers. In reality London has been booming with fast population growth.
...

Why do people think the population of high net worth individuals would have *anything* at all to do with general population numbers? Of course there is some very loose correlation, but I would think that the amount of *wine* a metro area drinks has as strong of a correlation (and perhaps stronger) to the number of high net worth individuals as the general population numbers do.

Chicago is essentially stagnant population-wise, overall. However the population of the central city is BOOMING, possibly ending the decade having added as many as 10,000 people per year from 2010 to 2020, which would be like a 50% population increase in a decade in an area of less than 10 square miles. Property taxes are too high, but that's not a key determining factor for high net worth people. Income taxes are going up next year likely, but are still less than coastal cities for high net worth individuals. Homicide rates for the city overall don't really affect high net worth individuals because it's fairly well contained in areas they don't go. Yes, that's a cynical way to view it, but it's largely true. Many of the factors that impact whether or not high net worth individuals locate in a city remain strong for Chicago and in many cases are growing stronger, not weaker. So, yeah, Chicago's got problems. What else is new. Right now, though, the problems Chicago has are less concerning than problems it's had in past years.

One thing to realize about homicide numbers: As much as the press likes to make hay with them, from 1990 - 2000 Chicago grew for the first time in decades. But in the 1990s, Chicago's homicide totals were higher either every year or almost every year than last year's spike in homicides. So homicide numbers don't really directly correlate to population movement.

[Pedestrian]

Originally Posted by dimondpark

Decided to go down farther...

2014 Number of Individual & Joint Tax Returns Reporting Annual Income, $500,000+
San Francisco-San Jose MSAs 61,211
Los Angeles MSA 57,021

2014 Number of Individual & Joint Tax Returns Reporting Annual Income, $400,000+
San Francisco-San Jose MSAs 89,970
Los Angeles MSA 80,581

We need to be clear what we are talking about here:

Ultra high net worth individuals (UHNWI) are people with investable assets of at least $30 million, excluding personal assets and property such as a primary residence, collectibles and consumer durables

http://www.investopedia.com/terms/u/...uals-uhnwi.asp

It actually doesn't have much to do with income since many such peope have inherited money or money made earlier in life.

Also:

(2016) was a record year for the richest people on earth, as the number of billionaires jumped 13% to 2,043 from 1,810 last year, the first time ever that Forbes has pinned down more than 2,000 ten-figure-fortunes. Their total net worth rose by 18% to $7.67 trillion, also a record. The change in the number of billionaires -- up 233 since the 2016 list -- was the biggest in the 31 years that Forbes has been tracking billionaires globally. Gainers since last year’s list outnumbered losers by more than three to one.

Bill Gates is the number one richest for the fourth year in a row, and the richest person in the world for 18 out of the past 23 years. He has a fortune of $86 billion, up from $75 billion last year. Amazon’s Jeff Bezos had the best year of any person on the planet, adding $27.6 billion to his fortune; now worth $72.8 billion, he moved into the top three in the world for the first time, up from number five a year ago.

https://www.forbes.com/sites/kerryad.../#1156ace262ff

[Private Dick]

Originally Posted by tech12

Except for the fact that SF and SJ are already part of the same CSA, share public transit (including BART, soon), share radio/tv stations, share sports teams, share government stuff (the Metropolitan Transportation Commission covers both MSAs, for example), and identify as being within the same region. None of that is true for NYC and philly.

The truth is that the US census methodology for determining MSAs (and urban areas) works well with a more typical development layout of a central city with suburbs radiating outwards, but it's reliance on commuter interchange and contigous development of a certain density/width, doesn't play nice with multi-nodal metro areas with development patterns that are constrained by geography, and in the case of the Bay Area, breaks it down too much. That doesnt mean that multi-nodal metros aren't metros though.

Go ask someone living in vallejo if their city is a suburb of SF/Oakland. They'll say yes....yet the census considers vallejo to be the principal city of a separate metro area. Sometimes the ideas that work on paper just don't reflect reality.

Of course the CSA definition isnt perfect either. Most people don't consider Santa Cruz and Stockton to be part of the Bay Area, for example. But it is more accurate for this region than the MSA measurement is, when trying to figure out the extent of the SF/Oakland/SJ metro area.

First off, transit is shared in NYC and Philly... maybe by different names and governed by different authorities, but it's still basically one (albeit very major) connected rail system. It's just a much different situation in the Bay Area in terms of the age, size, influence, individual economic power, etc. of the cities. I get it... San Jose would likely not have a transit system at all and probably would be a pretty awful place if San Francisco didn't exist... so I definitely get the tight connection.

Second, I totally agree with what you're saying and the whole MSA or CSA designation more often than not does not represent reality. So really, the fact that SF and SJ are part of the same CSA and NYC and Philly are not really doesn't matter (particularly in the context of economic connections/wealth). Though I definitely agree that SF/SJ metro areas are one.

I'm just saying that if we want to start grouping highly-connected and merged, yet arbitrarily distinct cities/metros together, then it has to apply across the board, if we are to make truly meaningful comparison.

If one were to take the what... 50-60? mile radius/footprint of the combined SF/SJ metro areas and say they are one, well then you gotta do the same with the east coast , if we're to have a truly valid comparison. We can't pick and choose and say NYC metro is it's own distinct non-connected place and it ends precisely at Trenton, NJ (for example) only because it happens to be on the New Jersey side of the river... when it can be very easily argued that Trenton is more a suburb of Philadelphia than it is New York.

[Crawford]

Originally Posted by emathias

Why do people think the population of high net worth individuals would have *anything* at all to do with general population numbers?

I think the two numbers would generally be closely correlated. Why wouldn't they be? Certainly Dallas is gaining HNW faster than Philly, because the overall population is growing faster. You're gonna get more rich folks when the overall pie increases.

Originally Posted by emathias

Chicago is essentially stagnant population-wise, overall. However the population of the central city is BOOMING, possibly ending the decade having added as many as 10,000 people per year from 2010 to 2020, which would be like a 50% population increase in a decade in an area of less than 10 square miles.

Now this is something that would have absolutely nothing to do with regional HNW counts. Putting aside the fact that Chicago's core isn't really doing anything not happening in any other major metro, it isn't clear why a downtown construction boom would have anything to do with relative growth of HNW.

Are you saying that much of the HNW population in Chicagoland is employed in the development and construction industries, so a development boom is a proxy for a wealth boom? Not really plausible, and Chicago, if anything, is a relative development laggard.

Most Chicago wealth is probably the same as anywhere else- inherited money, successful doctors, law firm partners, C-level executives, private business owners. If the overall population isn't growing, and regional wealth isn't particularly fast-growing, there would be little reason to assume there's some regional boom in law firm partners or radiologists or successful business owners.

[Urban Zombie]

I think what everybody is failing to account for here, is that if you cut taxes for the highest 0.000000000001 of the income bracket, all of those savings will trickle down to the middle class and create more jobs and economic growth!

[JManc]

Originally Posted by Pedestrian

Facebook IPO'd in 2012 and closed trading its first week as a public company at $26 and change per share. 6 years earlier in 2006, Yahoo tried to buy it for $1 billion. Today it has a market cap of over $400 billion. That's quite a lot of wealth creation in the last decade since this thread is about the very wealthy and where they live: In other words, in the last 10 years (to me more than 10 years ago seems a fair way to look at "years ago"), Facebook alone has created a lot of people in the "ultra high net worth" category.

Similarly, in the last 10 years Netflix stock has gone from around $2.50 per share to almost $150.00 multiplying the net worth of its founders and early holders by 60 times. Amazon's market cap is now 10 times what it was 10 years ago. And so on and so on.

So it doesn't make a lot of sense to me to think of tech money as in any way "old money" or claim a lowish growth rate in the tech economy in 2015/2016 is due to tech being an industry that saw most of its growth "years ago".

What is happening in 2015/2016 is that in that time frame and into 2017 tech growth has slowed transiently as happens to all industries. Just prior to these last 2 years it was booming and it will boom again. I personally have seen a number of these slumps, the worst being in 2000-2003. But there are many tech companies, perhaps the majority not yet public, around in 2017 that didn't exist in 2010 even and more being dreamed up every day. The tech industry is very different today than 10-20 years ago ("years ago" in a reasonable definition). In the 1990s it was about hardware: routers, switches, chips, fiber. Companies specializing in that stuff, like 90s darlings Cisco Systems and Intel, are relative dogs today. Companies from that era that have managed to reinvent themselves (Cisco is trying to reinvent as a net security company) like Microsoft, Amazon and Google are doing much better, but they are practically new companies.

From what I understood from this graph that was referring to new ultra high net worth individuals created between 2015-2016. Companies like FB, NFLX and AMZ were already making their founders, top level executives and investors tons and tons of $$$$ by 2015. Even new upstarts like Uber and Snapchat were already multi-billion dollar companies by this time.

[the urban politician]

Originally Posted by Crawford

Now this is something that would have absolutely nothing to do with regional HNW counts. Putting aside the fact that Chicago's core isn't really doing anything not happening in any other major metro, it isn't clear why a downtown construction boom would have anything to do with relative growth of HNW.

The construction and thus population boom in central Chicago is definitely higher than nearly any other metro. You just don't take much interest in it hence why would you know about it?

Are you saying that much of the HNW population in Chicagoland is employed in the development and construction industries, so a development boom is a proxy for a wealth boom? Not really plausible, and Chicago, if anything, is a relative development laggard.

Most Chicago wealth is probably the same as anywhere else- inherited money, successful doctors, law firm partners, C-level executives, private business owners. If the overall population isn't growing, and regional wealth isn't particularly fast-growing, there would be little reason to assume there's some regional boom in law firm partners or radiologists or successful business owners.

But the data refutes what you say. Lower and middle class households are leaving and higher income households are coming in:

http://www.chicagobusiness.com/artic...ority-minority

And being that higher income households have fared better in this economy, all you need is for the same people to sit there and, by their salary and investments, become millionaires on paper. Thus even without a population gain you can gain millionaires. Helll, even with a GDP rise you'all gain millionaires.

It's pretty obvious, but of course I'm sure since we're talking about Chicago you'll assume the data must be off

[YSL]

Originally Posted by JManc

Because this is only from 2015-2016. Most wealth in tech was created years ago.

No, this list is a 2016-2017 list.
San Francisco's tech boom at the very top was in 2014-2016, and has cooled considerably. The last wealth X list, (2015-2016) did show San Francisco having the highest % growth during that time.

[Ragnar]

Originally Posted by dimondpark

Decided to go down farther...

2014 Number of Individual & Joint Tax Returns Reporting Annual Income, $500,000+
San Francisco-San Jose MSAs 61,211
Los Angeles MSA 57,021

2014 Number of Individual & Joint Tax Returns Reporting Annual Income, $400,000+
San Francisco-San Jose MSAs 89,970
Los Angeles MSA 80,581

If you're going to combine MSA's for the Bay Area, shouldn't you add Riverside MSA to LA? (not that I expect the needle to move all that much by adding the IE).

[YSL]

Originally Posted by Crawford

No way are these numbers correct.

How did London lose 15% of it's HNW households in one year? That's like wartime catastrophe numbers. In reality London has been booming with fast population growth.

And it isn't Brexit. These numbers are pre-Brexit.

This list is from 2016-2017, according to the survey (you can download the report), so yes, Brexit occurred during the period of this survey.

Someone worth $30 million pre-Brexit is only worth $22 or so million, so clearly, that has a huge impact on the numbers. Too much of London's wealth has been via GPB currency.

From the study

In contrast to North America and Asia, ultra wealth trends were more subdued in EUROPE, the other dominant UHNW region. The number of ultra wealthy individuals decreased marginally by 0.2%, while the combined wealth of the region declined by 2.4%, dragged down by sharp falls in the UK and Russia. The most immediate impact of the mid-year Brexit vote in the UK was a slump in the value of sterling, which fell to a 31-year low against the US dollar before recovering a little ground later. Despite resilient economic growth and a positive equity performance – the benchmark FTSE-100 Index ended 2016 at an all-time high in local-currency terms, boosted by mining companies and overseas earners – overall dollar-denominated UHNW wealth in the UK fell 14.2%

[dimondpark]

Originally Posted by Pedestrian

We need to be clear what we are talking about here:


http://www.investopedia.com/terms/u/...uals-uhnwi.asp

It actually doesn't have much to do with income since many such peope have inherited money or money made earlier in life.

Also:


https://www.forbes.com/sites/kerryad.../#1156ace262ff

Yeah I get that, but this is data where LA should be leading overwhelmingly if it supposedly has way more individuals worth $30 million+ than the combined total of SF-SJ.

That, and based on the fact that SF-SJ has considerably more billionaires, and the previous rankings by the very report cited by the OP, leads me to believe this ranking is wrong with respect to LA and the Bay Area, not to mention London's supposed tumble.

[YSL]

Originally Posted by dimondpark

Yeah I get that, but this is data where LA should be leading overwhelmingly if it supposedly has way more individuals worth $30 million+ than the combined total of SF-SJ.

That, and based on the fact that SF-SJ has considerably more billionaires, and the previous rankings by the very report cited by the OP, leads me to believe this ranking is wrong with respect to LA and the Bay Area, not to mention London's supposed tumble.

Forbes only ranks working, doesn't it?